Nishitani & Nishitani
[2025] FedCFamC1F 268
•29 April 2025
FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
(DIVISION 1)
Nishitani & Nishitani [2025] FedCFamC1F 268
File number: SYC 5453 of 2024 Judgment of: SCHONELL J Date of judgment: 29 April 2025 Catchwords: FAMILY LAW – CONTRAVENTION – PENALTY – Where contravention conceded – Consideration of penalty – Where the wife sought the imposition of a sentence of imprisonment with various suspensions – Where the husband contends that no sanction should be applied, but in the alternative that the maximum fine and a further payment of 50,000 to the wife would be appropriate – Where both parties agree that the maximum fine of 60 penalty units amounts to $19,800 – Orders made for the husband to pay $19,800 as a fine and a further $50,000 to the wife.
FAMILY LAW – COSTS – Where the wife sought her costs in relation to the application in a proceeding on an indemnity basis – Where the husband conceded an order for indemnity costs for the first appearance but opposed an order for indemnity costs on the second appearance – Consideration of factors under s 117 of the Family Law Act 1975 (Cth) – Where the Court is satisfied there are exceptional circumstances warranting indemnity costs given finding that there was no reasonable excuse for the contravention of an order – Costs ordered on an indemnity basis.
Legislation: Evidence Act 1995 (Cth) s 140
Family Law Act 1975 (Cth) Pt XIIIA ss 112AA, 112AB, 112AC, 112AD, 112AE, 117
Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth)
Cases cited: Australasian Meat Industry Employees Union v Mudginberri Station Pty Ltd 161 CLR 98; [1986] HCA 46
Bant & Clayton (Costs) (2016) 56 Fam LR 31; [2016] FamCAFC 35
Colgate-Palmolive Co v Cussons Pty Ltd (1993) 46 FCR 225; [1993] FCA 801
Dinsdale v The Queen (2000) 202 CLR 321; [2000] HCA 54
Fitzgerald v Fish (2005) 33 Fam LR 123; [2005] FamCA 158
Galvis & Galvis [2024] FedCFamC1A 123
Kohan and Kohan (1993) FLC 92-340
Penfold v Penfold (1980) 144 CLR 311; [1980] HCA 4
Yunghanns & Ors v Yunghanns & Ors and Yunghanns (2000) FLC 93-029; [2000] FamCA 681
Division: Division 1 First Instance Number of paragraphs: 73 Date of hearing: 9 April 2025 and 16 April 2025 Place: Sydney Counsel for the Applicant: Ms Petrie Solicitor for the Applicant: Fox & Staniland Counsel for the Respondent: Mr Stapleton Solicitor for the Respondent: Keypoint Law ORDERS
SYC 5453 of 2024 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 1)
BETWEEN: MS NISHITANI
Applicant
AND: MR NISHITANI
Respondent
ORDER MADE BY:
SCHONELL J
DATE OF ORDER:
25 APRIL 2025
UPON NOTING THAT:
A.The husband has contravened without reasonable excuse Order 6 of the orders made by Senior Judicial Registrar McNamara on 19 November 2024.
THE COURT ORDERS THAT:
1.The husband pay to the Sydney Registry Manager of the Federal Circuit and Family Court of Australia a fine of $19,800 within 14 days.
2.The husband pursuant to s 112AD(4) of the Family Law Act 1975 (Cth) pay to the wife the sum of $50,000 within 14 days.
3.The husband pay to the wife her costs of the Application – Contravention fixed in the sum $36,100 within 14 days.
Note: The form of the order is subject to the entry in the Court’s records.
Note: This copy of the Court’s Reasons for judgment may be subject to review to remedy minor typographical or grammatical errors (r 10.14(b) Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth)), or to record a variation to the order pursuant to r 10.13 Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth).
Part XIVB of the Family Law Act 1975 (Cth) makes it an offence, except in very limited circumstances, to publish an account of proceedings that identify persons, associated persons, or witnesses involved in family law proceedings.
IT IS NOTED that publication of this judgment by this Court under a pseudonym has been approved pursuant to subsection 114Q(2) of the Family Law Act 1975 (Cth).
REASONS FOR JUDGMENT
SCHONELL J:
These are proceedings under Part XIIIA of the Family Law Act 1975 (Cth) (“the Act”). The wife moved on an Application–Contravention filed 30 December 2024 contending the husband contravened without reasonable excuse an order made by a Senior Judicial Registrar on 19 November 2024.
By way of order made 6 February 2025, the Court recorded that then counsel for the husband advised that the husband admitted the contravention. That was confirmed by counsel appearing for the husband at the hearing on 9 April 2025. In light of such concession, the issue became whether the husband had a reasonable excuse and if not, what sanction (if any) should be imposed.
On 7 April 2025, the Court made the following directions:
1.The Application–Contravention filed on 30 December 2024 is listed for hearing in person before Justice Schonell on 9 April 2025 at 10.00 am.
2.The respondent do all things as are necessary to ensure he is ready to proceed to adduce any evidence in response to the Application–Contravention, if established, at the hearing on 9 April 2025.
The hearing took place over two days on 9 and 16 April 2025.
The contravened order was to the following effect:
6.Within 7 days from the date of these Orders, the husband shall deliver [Motor Vehicle 1] to the wife for her exclusive use and surrender all keys to the motor vehicle to the wife.
The wife relied upon the following documents:
(1)Application in a Proceeding – Contravention filed 30 December 2024;
(2)Affidavit of wife filed 30 December 2024;
(3)Cost Notice dated 8 April 2025;
(4)Cost Notice dated 15 April 2025; and
(5)Case Outline document.
The husband relied upon the following documents:
(1)Affidvit of husband filed 8 April 2025;
(2)Affidvit of husband filed 15 April 2025;
(3)Affidavit of Ms B filed 15 April 2025;
(4)Financial Statement filed 8 April 2025;
(5)Cost Notice filed 9 April 2025;
(6)Costs Notice filed 16 April 2025; and
(7)Financial Statement filed 19 November 2024.
Following cross-examination of the husband on 9 April 2025, the Court proceeded to hear submissions as to whether the husband had a reasonable excuse, what (if any) was the appropriate sanction, and costs. The wife seeks by her application, if established, a sanction of one month’s imprisonment suspended on various conditions. When making submissions as to sanction counsel for the husband sought the opportunity to adduce further evidence notwithstanding the clear terms of the orders made on 7 April 2025 and despite knowing the sanction the wife had sought.
Orders were made for the husband to file any further affidavit by 15 April 2025 and for the matter to adjourn to 16 April 2025. At the resumed hearing the parties made further submissions and judgment was reserved.
BACKGROUND
The husband contends that the parties commenced cohabitation in 2011, were married 2014, and separated on a final basis in August 2022. The wife contends that the parties finally separated under the one roof in November 2022.
There are two children of the parties’ marriage aged five and three years old. It is not in issue that during the course of the parties’ relationship the wife had the use of Motor Vehicle 1 owned by the husband (“the car”).
In or about March 2024 the parties were engaged in an argument during which the husband took the keys and removed the car such that the wife did not have access to it.
On 16 July 2024, the wife commenced proceedings seeking interim and final orders. Part of the interim relief the wife sought was the return to her of the car. As then articulated, the wife also sought transfer of the car on a final basis.
The interim hearing took place before a Senior Registrar on 19 November 2024. At the interim hearing, the court was informed by the husband’s counsel that the husband was taking steps to sell the car. The senior registrar made, amongst other orders, Order 6 as referred to above. A notation to the orders is to the following effect:
B.The only outstanding issues requiring interim determination are the children’s time with father, the sale of the [Suburb C] property, and the sale of [Motor Vehicle 1] and the parties have been advised that the matter is only listed in relation to those issues on 6 February 2025.
Despite advising the Court that the husband had taken steps to sell the car neither the husband nor his legal advisors informed the Court (in the full knowledge of the order and the Notation) that the husband would continue to take steps to sell the car.
By the terms of Order 6, the car was to be delivered to the wife by 26 November 2024.
It is not in issue that the husband did not deliver the car to the wife in accordance with the order. On the last day by which it was to be delivered to the wife, the husband sold it to a third party and paid the proceeds to his father to whom it is alleged he owes money borrowed to buy the car some three years or so earlier.
On that same day, his solicitor sent a letter to the wife’s solicitor in the following terms:
We note that at the interim hearing on 19 November 2024 we informed the Court and Counsel on behalf of our client that [Motor Vehicle 1] was for sale.
In the above circumstances, the Court did not make any Order restraining our client from selling the said [Motor Vehicle 1].
We are instructed that [Motor Vehicle 1] has been recently sold and the proceeds of sale paid to our client's father, [Mr E] in partial repayment of the outstanding loan.
We are further instructed that our client has obtained his father's agreement to advance the sum of $50,000 by way of loan to our client for the purpose of providing the funds to your client to purchase a motor vehicle in her name and for her exclusive use with the children. The said funds will be advanced to your client by way of partial property settlement.
Please obtain your client's urgent instructions and provide us with her nominated bank details, including name of account, bank, BSB and account number, by reply email as soon as possible.
We will provide you with documents pertaining to the sale of [Motor Vehicle 1] upon our receipt of same by way of further and updating financial disclosure.
I will return to this letter later.
The wife did not accept the husband’s offer, and the husband has not made any payment to the wife or provided an alternative car to the wife.
LEGAL PRINCIPLES
The order the subject of the application is an order pursuant to s 112AA of the Act. The parties agree that the order was in the nature of an injunction and not a maintenance order.
Section 112AB of the Act provides that a person will be taken to have contravened an order if the person bound by the order intentionally failed to comply with the order or made no reasonable attempt to comply with it. It is not in issue that the husband failed to comply with the order.
Section 112AC of the Act provides that a person may have a reasonable excuse for contravening an order if they did not understand the order imposed upon them and the court is satisfied they ought to be excused in respect of the contravention. The test is conjunctive.
The Act does not prescribe the circumstances that may give rise to a reasonable excuse. The standard of proof is on the balance of probabilities (s 140 of the Evidence Act 1995 (Cth)). The burden of proof falls upon the husband to satisfy the court he had a reasonable excuse.
REASONABLE EXCUSE – S 112AC
The husband was briefly cross-examined by counsel for the wife. In the course of his cross-examination, he conceded that he was present in court when the order was made, that he understood the effect of the order at the time that it was made, and that he understood the issue in relation to the sale of the car had been stood over for further hearing to 6 February 2025. I am satisfied in light of his admissions that the husband made no reasonable attempt to comply with the order.
It was submitted by counsel for the husband that he had a reasonable excuse for not complying with the order because he held an honest belief that he could sell the car because no injunction had been made restraining him from doing so. He further submitted that because of what was said on 19 November 2024 and in circumstances where the car had been already placed for sale, he believed he could sell the motor vehicle. His counsel placed great emphasis on extracts of the transcript.
I do not accept that submission.
The transcript reveals as follows:
THE REGISTRAR: Yes. And will that - is it anticipated, Ms McMahon, that your client will be pressing, if I - since I'm bringing the matter back then - - -
MS McMAHON: Yes.
THE REGISTRAR: - - - and rather than just trying to - that all the interim issues .will be pressed in terms of the - so the outstanding interim issues would be your client's application for sale of [Suburb C].
MS McMAHON: Yes.
THE REGISTRAR: And then the sale of the motor vehicle.
MS McMAHON: Yes.
THE REGISTRAR: Although it appears that that's already proceeding anyway. I don't - - -
MS McMAHON: Yes.
THE REGISTRAR: - - - know what's happening there, but-and then time. Are they the issues?
MS McMAHON: They are the issues, as I understand them .....
…
THE REGISTRAR: Thank you. So I will list it on 6 February. I will direct each party to file and serve any updated consolidated affidavit in relation to the remaining interim issues by the by, say, 24 January. And then a case outlined by 31 January.
I'm going to note, when I list it for hearing on 6 February, in relation to the outstanding interim issues being the children's time with the father, the sale of the [Suburb C] property and the sale of [Motor Vehicle 1]. They're the issues that I will list it about, because I'm conscious of the fact that that will be enough to take up the time of the senior registrar, that day. And if anyone amends an application to introduce further issues, it will - they won't be dealt with.
(Transcript dated 19 November 2024, page 4 lines 5 – 25; page 5 lines 35 – 45)
Thereafter, the transcript reveals that counsel for the husband sought further clarification on some of the other orders but at no time sought clarification of the order requiring the husband to deliver the car to the wife.
The order is expressed in clear and unambiguous language and required the husband to deliver the car to the wife. Selling the car to a third party and not delivering it to the wife are incompatible propositions, particularly when he knew that the court would hear in February 2025 his application to sell the car and also knew the wife sought the car on a final basis.
To conclude otherwise would render the making of the notation otiose. The transcript reveals that at no time did his counsel seek clarification that the husband was permitted by the terms of the order to sell the car, as to have done so would have bordered on the ridiculous and absurd.
I am satisfied that the husband, by his admissions in cross-examination, knew what the order required him to do and knew that the issue of the sale of the car was to be determined on the next occasion.
I am not satisfied in circumstances where he carries the burden of proof that he has established that he had a reasonable excuse.
SANCTION – S 112AD
Section 112AD(1) empowers the court to impose such sanction as the court considers appropriate as identified in s 112AD(2). Section 112AD(2) is to the following effect:
112AD Sanctions for failure to comply with orders
…
(2) The sanctions that are available to be imposed by the court are:
(a)to require the person to enter into a bond in accordance with section 112AF; or
(b)to impose a sentence by order on the person, or make an order directed to the person, in accordance with section 112AG; or
(c)to fine the person not more than 60 penalty units; or
(d)subject to subsection (2A), to impose a sentence of imprisonment on the person in accordance with section 112AE.
The court has power pursuant to s 112AD(4) to make such further orders as it considers necessary to ensure compliance with the order that was contravened.
Section 112AE(2) provides that the court should not impose a sentence of imprisonment unless the court is satisfied that in all of the circumstances of the case it would not be appropriate for the court to deal with the contravention by imposing any other sanction.
The imposition of penalty is entirely a matter of the discretion of the trial judge (Dinsdale v The Queen (2000) 202 CLR 321. As referred to above, the penalties range from the imposition of a fine of a maximum of 60 penalty units (the parties agree that the maximum fine could be $19,800) through to the imposition of imprisonment.
A sentence of imprisonment is a sentence of last resort and should not be imposed unless the court is satisfied that it is not appropriate to impose any other sentence.
The wife seeks the following orders:
1.Having found that the Respondent has without reasonable excuse intentionally contravened an Order under the Family Law Act 1975 (“the Act”), being Order 6 of the Orders made by Senior Judicial Registrar McNamara on 19 November 2024, the Court makes an Order pursuant to s112 AD of the Act imposing the following sanctions:
a.Pursuant to s112AD(2)(d) an Order in accordance with s112AE that the Respondent be imprisoned for a specified period of one month.
b.That the operation of Order 1 a) be suspended pursuant to s112AE(4A)(a) upon the condition that:
(1.)within 14 days of the date of this Order the Respondent comply with Order 6 of the Orders made by Senior Judicial Registrar McNamara on 19 November 2024; or in the alternative
(2.)within 14 days the Respondent shall deliver up to the Applicant for her use a 2019 [vehicle model] or later model in good, registered and roadworthy condition and thereafter ensures that the Applicant has the sole use of the vehicle for a continuous period of 12 months from the date of these Orders.
(3.)And in default of both 1)b) (1) and (2) the suspension pursuant to s112AE(4A)(a) be terminated pursuant to s112AE(4A)(b)
c.That Order 1a) be discharged on a date 12 months from the date of this Order if it has not already taken effect.
The wife’s counsel submitted that the husband’s conduct represented a deliberate and flagrant disregard for the order. Whilst recognising that imprisonment was a sanction of last resort, her counsel submitted that the husband’s conduct was so serious that no other sanction was, in all of the circumstances, appropriate and that a term of imprisonment was necessary.
The husband’s counsel submitted that the court should not impose any sanction in circumstances where the husband had offered, in the letter advising of the sale of the car, the sum of $50,000 by way of partial property settlement. I do not find the letter or its terms to constitutes a basis for not imposing a sanction, nor does it constitute any mitigating circumstance. The letter contains not a scintilla of remorse or contrition. Its tone and content bespeak unbridled arrogance. I regard the letter as nothing short of a cynical attempt to absolve the husband of his responsibility for his failure to comply with the order.
His counsel submitted that the court should not move to imprisonment as it is the remedy of last resort, and the objective seriousness of the contravention does not warrant it.
The husband adduced evidence as to sanction as follows:
5.If the Court decides to sanction me, I ask that the Court fine me according to the maximum fine available pursuant to section 112AD(2)(c) of the Family Law Act, being what I believe to be $19,800. In addition to the fine, any indemnity costs order I will be ordered to pay would be a painful lesson for me and would act as a heavy deterrent. I could afford to pay such a fine from the sale of cryptocurrency assets I current hold. I appreciate it would have a modest deleterious effect on the value of the pool, but I would expect the amount to be an add back to my credit in the final trial balance sheet, mitigating any adverse effect of it on the wife.
6.I confirm that for the limited purpose of me proposing a condition of any suspension of any sentence, my father remains willing to lend me $50,000 that I could provide to the wife for her to use to apply towards the purchase of a motor vehicle. I would then be content for the Wife's receipt of that money and my debt to my father to be characterised by the trial Judge based on the facts and circumstances in which they arose. I am aware however that proposal would not be as practical or beneficial to the wife as the proposal I outline in paragraph 7 herein.
During the course of submissions, the husband’s counsel agreed that in the terms of s 112AD(4) the husband would provide $50,000 to enable the wife to obtain another car in circumstances where the court proceeded to impose a fine as a way of ensuring compliance with the order which was to provide to the wife a car.
The husband and the wife remain involved in proceedings before the court in relation to both financial and parenting matters. The Court expects parties to comply with its order and parties who fail to comply should have an expectation that their failure will have consequences. I am satisfied that it is necessary to impose a sanction “to protect the effective administration of justice by demonstrating that the court’s orders will be enforced” (Australasian Meat Industry Employees Union v Mudginberri Station Pty Ltd 161 CLR 98 at [17].)
In determining a sanction, I must have regard to the seriousness of the contravention. I am not satisfied that the circumstances of this contravention are so serious as to warrant the imposition of a sentence either in the terms of s 112AG or s 112AE. Nor am I satisfied that there should be a sentence of the type the wife seeks with its various suspensions. The first suspension condition she seeks could not be imposed as the car has been sold and in the case of the second there is no evidence that such a car could be obtained within 14 days. The wife’s counsel submitted that a bond was not appropriate, albeit in circumstances where she sought a more serious sanction. I agree that a bond is not appropriate but reach that conclusion as it is disproportionate relative to the seriousness of the contravention and given that it is not suggested that the husband has contravened an order on any other occasion.
In all the circumstances, I am satisfied that the appropriate sanction is the imposition of a fine. In considering the magnitude of the fine I regard the husband’s conduct to be such as to call for the imposition of a fine at the highest end of the range and note that the husband conceded that if a fine is to be imposed then it should be the maximum fine.
Accordingly, I will impose the maximum fine of 60 penalty units. It is clear from the husband’s financial statement that he has the capacity to meet such a penalty.
I am also satisfied that it is appropriate and proper to make the order the husband proposes of a $50,000 payment to the wife to enable her to purchase another car. The order was designed to ensure that she had a car. The payment he proposes is necessary to ensure compliance with the order.
I propose to make an order the husband pay a fine of $19,800 within 14 days and order him to pay the wife $50,000 within 14 days to ensure compliance with the order. His counsel submitted such a time period.
COSTS
At the conclusion of the hearing on 9 April 2025, the wife sought an order for indemnity costs in the sum of $27,950. Counsel for the husband quite properly conceded in my view that the sum sought was both reasonable and proper and that an order for indemnity costs should be made. I am satisfied that it was a proper concession for the husband’s counsel to make and I am satisfied that the circumstances justify an order for indemnity costs.
In relation to the appearance on 16 April 2025, the wife sought her costs of the appearance on that occasion on an indemnity basis in the sum of $8,150. In support of the order, she submitted that the appearance was entirely as a consequence of the adjournment sought by the husband and that as a measure of reasonableness his own costs were approximately $13,000.
Counsel for the husband opposed an order for indemnity costs for the appearance on 16 April 2025 submitting that the husband’s application to adjourn was appropriate, citing in support the observations of Austin J in Galvis & Galvis [2024] FedCFamC1A 123 where his Honour observed:
38In contempt proceedings, it is usual for the question of penalty to be separately addressed after the findings of contempt are made (Mead v Mead (2007) 235 ALR 197 at 198). The same procedure should apply in respect of contravention proceedings. That is because the evidence which is pertinent to the imposition of penalty is usually different from that which is relevant to the anterior question of fault.
39After the findings were made to sustain the four contraventions, the appellant ought have been afforded the chance to adduce any further evidence and to make any further submissions which could influence the determination of the penalty imposed upon her. That denial of procedural fairness was an error of law which demands the re-exercise of the sentencing discretion. The respondent could not gainsay the result might be different if the appellant is allowed the chance to adduce evidence and make further submissions on the issue of penalty (Stead v State GIO (1986) 161 CLR 141). It is no answer for the respondent to say he believes the primary judge reached the right result regardless and so the error of law is immaterial.
The reasoning of his Honour is unimpeachable but has no application here where the husband was granted an adjournment to adduce the evidence he subsequently relied upon.
The husband also submitted he made an offer of settlement (Exhibit 4) which offer was rejected by the wife. If the offer had been accepted, it would have obviated the further hearing.
An application for costs is governed by the provisions of s 117 of the Act, which provides a general rule that each party to the proceedings should bear their own costs.
Section 117(2) of the Act reposes in the Court a discretion to make a costs order if the Court determines there are circumstances that justify this and, if there are such circumstances, the Court may make such order as it considers just, having regard to the matters set out in s 117(2A) of the Act.
In Penfold v Penfold (1980) 144 CLR 311 at 315, the plurality in the High Court determined that to make an order under s 117(2) of the Act, the Court needs to make a finding of “justifying circumstances” as a preliminary prerequisite to the making of an order. Their Honours also observed that a term such as “a clear case” is not necessarily a determiner of whether an order for costs should be made. All that is required or necessary is that there are justifying circumstances.
It is well-settled law that no one factor in s 117(2A) is determinative, and the Court may give such weight as it considers relevant to any factor. In Fitzgerald v Fish (2005) 33 Fam LR 123 at 130, the Full Court observed:
41. … Nowhere in subsection 2(A) or elsewhere in section 117, is there any prescription that more than one factor must be present before an order for costs is made nor of comparative weight of the factors set out in subsection 2(A). As a consequence, there is nothing to prevent any factor being the sole foundation for an order for costs.
Addressing the matters under s 117(2A) I find as follows:
(a) The financial circumstances of each party to the proceedings
Neither party submitted this to be a relevant consideration.
(b) Whether any party was in receipt of legal aid
This is not applicable.
(c) The conduct of the parties
What is relevant is conduct of a party which in some way or other leads to an increase in costs by the other party. Such factors may include uncooperative behaviour, obstruction, prolonging litigation or the bringing of unreasonable or unmeritorious applications. It may include non-disclosure or a failure to comply with the Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth) (“the Rules”) in relation to disclosure.
The husband conceded he did not comply with an order but contended he had a reasonable excuse. I am satisfied he did not have a reasonable excuse.
(d) Whether the proceedings were necessitated by the failure of a party to comply with a previous order
The section refers to proceedings as opposed to an application within proceedings. This is not applicable.
(e) Whether any party to the proceedings has been wholly unsuccessful in the proceedings
The term “wholly unsuccessful” refers to a situation in which proceedings as a whole have been unsuccessful, rather than necessarily an application or a form of relief (Bant & Clayton (Costs) (2016) 56 Fam LR 31). The husband was not wholly unsuccessful.
(f) Whether either party to the proceedings has made an offer in writing to the other party to the proceedings to settle the proceedings and the terms of any such offer
The husband relies upon an offer he made to resolve the application which he says the wife unjustifiably rejected. I am not satisfied the offer is relevant to the question of costs on this aspect of the application. The offer contained terms that were not the subject of the orders proposed to be made. It could not be said that the husband did better on the application that he provided in the offer.
(g) Any other matter the court considers relevant
There is no other matter that the court considers relevant.
I am satisfied that the husband’s conduct in contravening an order without reasonable excuse is a factor justifying an order for costs, particularly given the seriousness of his conduct.
INDEMNITY OR PARTY/PARTY COSTS
An order will be made that the husband pay the wife’s costs. I will now turn to consider whether the order should be made on an indemnity or a party/party basis.
The authorities make plain that an order for indemnity costs is not one that is lightly made, and there should be circumstances of an exceptional kind that warrant orders for costs on an indemnity basis (Kohan and Kohan (1993) FLC 92-340). Justice Sheppard in Colgate-Palmolive Co v Cussons Pty Ltd (1993) 46 FCR 225 identified various guidelines as to the circumstances in which a court might entertain an order for indemnity costs. The category of cases in which a court may make an indemnity costs order are not closed and are not limited to those identified by Sheppard J (Yunghanns & Ors v Yunghanns & Ors and Yunghanns (2000) FLC 93-029 at 87,471).
I am satisfied that the conduct of the husband in contravening the order without reasonable excuse is such as to attract the description of exceptional. The question of sanction is an integral part of the application. The husband conceded that an order for indemnity costs was warranted on the substantive application but not for this aspect dealing with sanction. I do not accept that submission, nor the logic of it. The adjournment came about because the husband sought an indulgence given he was not ready to meet the question of sanction despite orders having been made for him to be ready to adduce such evidence as he saw fit to adduce. He should have been ready to meet it at the hearing on 9 April 2025. I see no differentiation between his concession to meet the wife’s costs of the substantive application and her costs of dealing with sanction. An order for indemnity costs is entirely justified in the circumstances.
An order will be made for the husband to pay the wife’s costs of the appearances on 9 and 16 April 2025 on an indemnity basis fixed in the sum of $36,100.
I certify that the preceding seventy-three (73) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Schonell. Associate:
Dated: 29 April 2025
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